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Friday, March 25, 2011

North End Subaru favorite Ken Block and co-driver Alex Gelsomino have both been taken to a hospital for examination after the Monster World rally Team driver crashed heavily during yesterdays Rally of Portugal shakedown stage.

A spokesman from the Monster team said: "Both Ken and Alex have been taken to hospital in Faro for precautionary checks. All I know is that they rolled, but they're okay."

Monday, March 21, 2011

As Japan's escalating disaster comes ashore in North America, automakers, suppliers and dealers are preparing for shortages of parts and vehicles.

-- On Thursday, March 17, American Honda Motor Co. Executive Vice President John Mendel sent a memo to U.S. Honda and Acura dealers saying the disaster in Japan will disrupt dealer orders into May.

-- General Motors' Shreveport, La., factory, which builds the Chevrolet Colorado and GMC Canyon pickups, closed because it ran out of a Japanese part that it did not identify.

-- Toyota Motor Corp. and Subaru of Indiana Automotive Inc. slowed North American production to ration their parts.

-- At Sonic Automotive Inc., the nation's third-largest dealership group, Jeff Dyke, executive vice president of retail operations, said Sonic "is prepared to supplement our new-vehicle inventory with quality nearly new used vehicles should the manufacturing disruptions interrupt new vehicle inventory supplies longer than currently anticipated."

-- Last week U.S. Customs directed all port operations to begin screening arriving Japanese sea and air cargo, including vehicles and auto parts, for radiation contamination. Customs will turn away containers or people if unacceptable levels of radiation are detected.

If factory shutdowns spread, says Jesse Toprak, vice president of industry trends at Truecar.com, U.S. retailers should prepare for higher transaction prices on new vehicles in the next 60 days. "Not just Japanese-brand vehicles but all brands," Toprak says. "If there is going to be scarcity of Japanese models, then you will see their incentives fall. And if incentives fall on those brands, you can be certain they will fall everywhere."

Toprak estimates that the average transaction price of the Toyota Prius, which is built only in Japan, will go from $1,732 below sticker last week to $800 above sticker by April 30. One of three Japanese battery plants supplying the Toyota Prius was damaged by the quake. "We have a Toyota dealership that sells 25 Prius models a month, and we have 13 in stock," said a dealership group executive who asked not to be identified. "What do you think will happen?"

Some of the transaction price increases reflect rising gasoline prices. Many of the models now threatened by production disruptions in Japan are among the automakers' most fuel-efficient, including the Honda Fit, Insight, Civic Hybrid and CR-Z. TrueCar.com forecasts that the discount off sticker on a Honda Fit will shrink from an average of $1,188 last week to $400 by April 30, effectively a price increase of $788.

Ford Motor Co. declined to speculate what impact future parts shortages would have on its sales. "We don't want to be drawn into what potential impact it might have because this situation is moving so quickly," says Todd Nissen, a Ford spokesman. Ford has not experienced any parts' shortages that would force it to suspend production at any plants, Nissen says. But he warns: "It's a situation that changes constantly and we're monitoring it daily with hourly contact with our suppliers, shipping companies and all the others that are part of the logistics system." He declined to quantify the percentage of parts used by Ford that come out of Japan.

Multiple Shocks

Vehicle producers in Japan quickly inspected the damage at their plants last week after the multiple shocks of two earthquakes, a tsunami and the unfolding nuclear power-plant disaster. Assembly plant shutdowns there will mean more than 285,000 units of lost production, just through March 23, predicts global forecasting firm IHS.

But as the week ended, Japan's auto companies were still struggling to get information from their thousands of suppliers around that nation -- companies that also export materials and components to U.S., European and Asian customers. In some cases, purchasing managers in Japan couldn't even communicate with suppliers let alone assess the damage to the parts plants. "Most of us have a pipeline for a while," said an American staffer at a Japanese automaker in North America who asked not to be identified. "But when those run out, there's going to be trouble. You have to consider that even our American suppliers get parts out of Japan."
Japan exports 2 million transmissions a year to North America and another 6.5 million to other world markets, IHS estimates. The forecasting consultant estimated last week that as many as two-thirds of Japan's 72 engine and transmission plants had stopped production.

Two of them belong to Jatco, a transmission maker owned by Nissan Motor Co. and Mitsubishi Motors Corp. Jatco's two plants south of Tokyo escaped unscathed from the first 9.0-magnitude earthquake on March 11, the ensuing tsunami and the succession of earthquake aftershocks that continued last week. Then they were damaged by the second, 6.2-magnitude earthquake in the middle of last week.

Jatco produces some transmissions in Japan for Nissan's U.S.- and Mexico-made vehicles, but a spokesman for Nissan North America was not able to say what production might be affected because of the problem.
Aisin Seiki Co. supplies transmissions to the Shreveport pickup plant GM shut down because of a parts shortage. Chuck Sanders, assistant vice president of Aisin's U.S. unit, said Aisin's transmissions were not part of the shortages.

Delphi Delays

Delphi Automotive has identified 20 of its 200 Japanese suppliers as being within 100 miles of the epicenter of the initial earthquake. "With the continued shortage of power and water in the area, we anticipate delays and/or that potential disruptions may occur and could impact much of the automotive supply chain," spokesman Lindsey Williams wrote in an e-mail to Crain's Detroit Business, a sister publication to Automotive News.

In addition to still uncounted damage to buildings, machinery, bridges, roads and utilities, companies in Japan face rolling electrical blackouts. Toyota, Nissan, Honda Motor Co. and others halted production at some undamaged plants last week because of utility interruptions. That problem was caused by the shutdown of damaged nuclear reactors in Fukushima, Japan. And that crisis, in turn, caused an entirely separate problem as corporations, residents and international governments began to fear radiation contamination.

As of late last week, Japanese nuclear power authorities had not publicly addressed the issue of how bad the radiation leakage is or could be. Nissan said it has begun monitoring all vehicles and parts for traces of radiation. Germany's BMW AG and Volkswagen Group recalled all German personnel from Japan.
Toyota, Honda, Mazda Motor Corp. and Suzuki Motor Co. say most or all of their Japanese plants will remain down until the middle of this week.

But uncertainty overshadows the discussion for many. Steve Curtis, a spokesman for Toyota Motor Sales U.S.A. Inc., said the automaker will "re-evaluate" on Tuesday, March 22, whether to restart production in Japan. The dicey future in Japan is illustrated by the case of the Japanese assembly plant the farthest from the earthquake's epicenter.

On Friday, Nissan reopened its Kyushu plant, which builds the Rogue and Murano crossovers, the new Quest minivan and other models. But Nissan plans to run the plant only until available parts are depleted.
It also said its North American plants will run normal schedules this week. But after that, production plans are uncertain.

Thursday, March 17, 2011

U.S. shoppers could see prices for some of the more popular Japanese built hybrid and fuel-efficient vehicles such as the Toyota Prius and the Subaru line up rise in the coming weeks.

The cost of the imports are likely to go up as earthquake-related production shutdowns in Japan are reducing the supply of the autos at a crucial time for fuel prices.A time when consumers are increasingly shopping for gas-sipping models.

"The Prius will go from selling under invoice just a couple of weeks ago to over the sticker price a couple of weeks from now," said Jesse Toprak, an analyst with car price information company TrueCar.com.

While Japanese automakers build most of their bestsellers in the United States, some models are still assembled and shippedfrom Japan. A handful of those vehicles are already in tight supply in the U.S. because they are either hot sellers, such as Subaru's Forester and

"We are doing a wait and see," said Dianne Whitmire, fleet director for Carson Toyota. "They are still assessing the supply issues in Japan. I hope it doesn't go back to dealers' marking up over sticker. But it looks like cars are heading back to MSRP."

Consumers will start to feel the crunch at the end of this month and into April, and the length of any price spike will depend on how quickly, and how completely, the Japanese auto industry can get back on line, analysts and dealers said.

In at least one measure of sales, Prius prices have already risen $169 to an average of $25,629 in the last week, according to TrueCar.com's listing of upfront, "no haggle" deals.

The Subaru models already have inventories of fewer than 30 days, and that's making dealers nervous.

"We are very concerned. We have no idea when we will see production start up again," said April Somers, general sales manager of Timmons Subaru in Long Beach. "Subaru was getting them here as fast as they could, and we were selling them real quick. Probably prices will rise."

The dealership has enough vehicles for a couple of weeks, "but we will really feel this in 30 days."

Toyota and other automakers in the beleaguered nation extended manufacturing suspensions Wednesday as they continued to assess the damage and to conserve energy to help Japan deal with multiple nuclear reactor generator failures.

IHS Automotive, an industry research firm, estimates that that as many as 185,000 vehicles were not built since the quake and that the number will continue to grow. March is typically the biggest month for Japanese auto production.

Automakers on both sides of the Pacific Ocean also are trying to figure out whether damage to the supply chain — the thousands of small companies that build components for vehicles — will create production bottlenecks that could delay production both in the U.S. and Japan.

"Once you start looking at the small suppliers in Japan, you see a lot of problems for the automakers … the small ones that might have been washed off the map and no one even knows yet," said David Sullivan, a product analyst with the consulting firm AutoPacific.

The lack of a single part can shut down an entire assembly line, Sullivan said. One of the crucial areas is that Japan remains a major source for automotive electronics, even for cars built in the U.S.

"Cars today can have upwards of 30 microprocessors in them. If some of those are coming from Japan it can have a ripple effect through the entire industry here," Sullivan said.

This is a worry even for European manufacturers. There is now a six- to eight-week supply of the semiconductors available to plants in North America and Europe, said Brian Johnson, an analyst at Barclays Capital. One automaker told Johnson that it would be a least a week before the manufacturers know the status of their semiconductor suppliers.

He said the "supply chain impact" of the quake is the biggest concern for the auto companies at this point.

Another issue is electrical power. Japan is going through a series of rolling power cuts that will continue at least until the end of April, officials of the Tokyo Electric Power Co. said. Auto factories and semiconductor plants are huge users of electricity and don't like power interruptions. The ovens in an auto plant paint shop can take as long as 10 hours to reach the correct temperatures, said officials. Having periods in which the power might go off makes it difficult to plan vehicle production, they said.

Saturday, March 12, 2011

When I arrived at work this morning the gossip on the lips of all the Salesmen was a variation of how bad these catastrophe's would affect Subaru production. Now it's not just gossip.

News coming out of Japan is that as a result of the quake and tsunami, Toyota, Honda, Nissan and Subaru all suspended production at plants in Japan today and are assessing the damage caused. It is reported that the shutdown could affect exports to the United States of many models including the Toyota Yaris sedan, Scion xB, Scion xD, Honda Fit, Honda Accord sedan and the Honda CR-V. Production of the Acura and Infiniti lineups will also be affected.

Toyota said that it has evacuated workers from several factories affected by the quake zone. Toyota has two part plants in northern Japan.

The status of those plants was being evaluated, Toyota spokesman Dion Corbett said. “We are still trying to get information from them,” he said. Lack of communication in the quake zone has made it hard for companies to get a clear picture of the extent of the damage.

Subaru, one of Japan’s smallest automakers, closed five factories. According to the latest word from the world’s largest automaker the plants that have stopped production are Toyota subsidiary plants that produce parts and vehicles, including:

Subaru will be the Official Automobile partner for the series. "Subaru and MESP, Inc. share the same drive and passion for outdoor activities," states Michael Epstein, president of MESP, Inc. "The partnership will be a perfect fit because of their unique identity with active lifestyle consumers and their willingness to help this unique consumer achieve their thirst for fun, fitness, friendship and adventure."

The Merrell Down & Dirty National Mud Run Series presented by Subaru consists of nine events in major cities around the country in which athletes compete in 5k and 10k runs through a fun off-road, muddy course with military style obstacles. This unique event has proven to test participants in conquering several challenges and mud pits on their way to the finish line all while supporting the troops through Operation Gratitude.

Operation Gratitude, the series official charity partner, is an organization that sends individual care packages enclosed with snacks, entertainment items and personal appreciation letters to U.S. Service Members deployed overseas.

Subaru recently announced its own PR (personal record) with another year of record sales in 2010. "Given the reliability and durability of our all-wheel drive products, Subaru owners continue to be passionate about outdoor events," said Tim Mahoney, senior vice president and chief marketing officer for Subaru of America. "This in turn drives our commitment to support runners, hikers and other outdoor enthusiasts, and it's why this partnership is a great fit."

Subaru owners also seek new outdoor experiences. "This run provides a very unique race opportunity," says Melissa Trotto, outdoor lifestyle sports marketing coordinator for Subaru. "Through this partnership, we will help people meet their fitness goals and have fun at the same time."

Monday, March 7, 2011

For those not familiar with the Burma Shave signs of years past: Burma Shave was a shaving cream product which featured a novel advertising method.

They placed small signs on the roads, spaced about 50 yards apart, in groups of 5 or 6. Motorists reading them would be rewarded with a somewhat humorous or philosophical ending at the fourth or fifth sign and then a reminder that it was brought to them by Burma Shave at the last sign.

Here is a selection of Burma Shave's "slogans" for you to enjoy.

Henry The Eighth
Prince of Friskers
Lost Five Wives
But Kept His Whiskers
Burma Shave

Grandpa's Beard
Was Stiff And Coarse
And That's What
Caused His
Fifth Divorce
Burma Shave

Saturday, March 5, 2011

But one of the often overlooked factors is resale value. How much the vehicle is projected to be worth after three, four or five years is key if you are the kind of driver likely to sell or trade the vehicle in after a few years.

Kelley Blue Book tracks a models resale value, and recently issued their list of the best brands and individual models for resale value.

Subaru named Best Overall Brand

The Japanese brand is best known for having all-wheel-drive standard on all of its vehicles. The Subaru Outback is ubiquitous in Minnesota, Maine, New Hampshire and Oregon — states that experience regular snow, lots of spring mud and rain. But Subaru also limits its sales rebates and other incentives, which means that owners are able to sell their vehicles for the biggest percentage of the original purchase price of any brand.

Of course, Subaru is also known for their owners hanging on to their vehicles well beyond 100,000 miles.

Wednesday, March 2, 2011

Subaru of America, Inc. today announced continued record-breaking sales for February, up almost 20% compared to the previous year.

February sales records were set by Forester, Impreza, Legacy and Outback. Impreza WRX volume more than doubled compared to the prior year and helped lead the Impreza carline to an impressive 40% increase.

Feb '11

Feb '10

% chg

Forester

6,334

6,315

0.3%

Impreza

3,933

2,804

40.3%

Legacy

3,242

2,615

24%

Outback

7,951

6,189

28.5%

Tribeca

223

175

27.4%

21,683

18,098

19.8%

"This is by far the best start to a year we've ever had," said Timothy M. Colbeck, senior vice president of sales, Subaru of America, Inc. "We have been working to get more units to our dealers, but every time we think they will build some inventory, they increase sales instead. With the exception of the Cash for Clunkers comparison in August, this is our 12th consecutive record month."

Thomas J. Doll, executive vice president and COO, Subaru of America, Inc. said, "While we are proud of our February results, we are also very excited that our entire organization - from Subaru of America, to our region and zone offices and independent distributors - is committed and poised for the continued growth of our franchise."